A fresh storm has erupted around HDFC Bank after the Lilavati Kirtilal Mehta Medical Trust on Saturday accused the bank's Managing Director and CEO, Sashidhar Jagdishan, of being involved in financial fraud tied to alleged misappropriations at the Trust. The allegations, which the bank flatly denies, come amid a long-standing dispute over loan defaults and internal conflicts within the Trust itself, as per a report by Indian Express.
In a strongly worded statement, the Trust demanded Jagdishan's immediate suspension and prosecution, claiming that a seized cash diary revealed Rs 14.42 crore had been misappropriated by trustees, with Rs 2.05 crore allegedly received by Jagdishan. The FIR, numbered 818/2025, was filed following an order from the Bombay Magistrate Court. The Trust has also urged regulators, including the RBI, SEBI, and the Finance Ministry, to act against the HDFC Bank chief, the report added.
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Outlook Money could not independently verify this news update.
Responding to the accusations, HDFC Bank called the claims "baseless and malicious." A spokesperson said, "The Trustee, Prashant Mehta and his family members owe substantial amounts to HDFC Bank which were never repaid." The bank maintains that recovery actions have been ongoing for over two decades and that the legal system, including the Supreme Court, has repeatedly ruled against Mehta and his associates, as quoted by Indian Express.
According to the bank, the accusations are part of a coordinated attempt by defaulters to derail recovery efforts. "The outrageous and preposterous allegations are strongly and categorically denied," the spokesperson said, adding that Jagdishan is being targeted by "unscrupulous persons" misusing legal avenues, as per the report.
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The Trust, however, argues that Jagdishan's position is untenable under RBI's 'Fit and Proper' norms, given the criminal allegations of conspiracy, corruption, and breach of Trust. It further alleged that his continued presence at the helm could lead to tampering of evidence and intimidation of witnesses.
One claim that stands out is the alleged Rs 1.5 crore payment to hospital staff, described by the Trust as a disguised CSR offer intended to obstruct justice. The Trust also accuses HDFC Bank of failing to act on multiple complaints and judicial findings, thereby breaching corporate governance norms and provisions of the Companies Act.
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Behind the legal firestorm is a long-standing rift within the Lilavati Trust itself. The institution, which manages the well-known Lilavati Hospital in Mumbai, has been embroiled in a leadership battle between the families of Kishore Mehta and Vijay Mehta. In 2023, after years of litigation, control was handed to Kishore Mehta's family, the report added.
The roots of the dispute stretch back to the early 2000s, when Kishore Mehta was allegedly ousted through forged board signatures while undergoing treatment overseas. Both Kishore and Vijay Mehta are now deceased, but the legacy of their power struggle continues to shape the Trust's internal dynamics.
"This is not a private feud or a commercial misunderstanding. This is a deeply rooted criminal betrayal of fiduciary obligations, charity law, public money, and the rule of law," said Prashant Kishor Mehta, a permanent trustee of the LKMM Trust. "Sashidhar Jagdishan has abused his institutional position not only to suppress truth but to subvert justice," as quoted by Indian Express.
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The current FIR is the third such case filed against former trustees and associates of the hospital, with allegations totalling Rs 1,250 crore in financial irregularities over two decades. Sections related to cheating, forgery, and criminal breach of Trust were invoked in the March 6 case, the report added.
